Global Carbon Markets Face Upheaval as Nations Remake the Rules
- Media Manager
- Jun 4, 2023
- 1 min read
BNN Bloomberg
Written By: Natasha White and Ewa Krukowska
Published: June 5th, 2023
The $2 billion market for carbon offsets is heading for a massive reset, as a growing number of sovereign governments announce their intention to tax, regulate or restrict trade in credits generated within their borders.
The details vary, but from Indonesia to Kenya to Honduras, the goals are the same: Governments want to retain more of the benefits of emissions-reduction projects, whether as revenue or as credit toward their own national climate goals.
“If you are a developing country and you have the right kinds of project opportunities, you’ve got a golden goose,” said Mark Lewis, head of climate research at Andurand Capital Management.
For countries with dense rainforests, mangrove swamps or other natural carbon sinks, carbon credits are increasingly considered alongside valuable minerals and metals like gold, lithium or copper
“Commodities markets have created the precedent,” said Samuel Gill, president and co-founder of Sylvera, a carbon research and ratings firm. “It is almost inevitable that nations come to see and treat carbon as any other national resource.”
That wake-up call has been prompted in part by a growing awareness that, as of now, governments and local stakeholders might receive just a tiny slice of the revenues made by foreign project developers, said Pablo Fernandez, chief executive of Ecosecurities, a project developer and investor.
